Debt Settlement Programs - Are They Effective Debt Relief Solutions?

Consumer CollectionsMany young people begin life with a minimum-wage job and a credit card. However, even with parental financial support, their debts begin to grow. Wisdom would dictate that the young person pay off the credit card debt every month so that he or she could avoid interest and penalties. However, the credit card is always tempting people to buy things now and pay for them later.

Problems begin slowly with a late payment that grows into two and three. Finally, payments are rotated between the house and car. Soon the realization strikes that the payments are more than the monthly income. What can they do?

There are several options to consider. The first is to file bankruptcy. This option may appear easy, but your credit rating is ruined for an extended amount of time and other merchants will be reluctant to extend you credit.

Debt consolidation is another option. However, this is no remedy. The payments may be lowered, but they will be made for many years. The mountain of debt continues to grow for a long time into the future. Therefore, what you need is something to reduce both your payments and your debt. To do that, you must negotiate.

When the business with whom you originally contracted the debt feels that it no longer can carry your debt on their books, they get what they can by selling your debt to a collection agency. The agency is willing to negotiate your debt so that you pay less than you actually owe. You get to keep all of your purchases, reduce your payments and are out of debt is less time. For example, if you owed $20,000 to the original business and were paying $500 a month, you might be able to reduce debt by 50 percent. That means you now owe $10,000, and you could negotiate a payment of $300. No one needs to tell you what you can do with that extra $200 a month.

It is always possible to negotiate lower amounts. No business wants to lose money and bad debts are losses. However, those losses are minimized when the business gets a portion of the debt rather than settling for nothing and the buyer can benefit from that same principle.

The next time the collection agency calls, remember that those people from whom you made your purchases are giving you the opportunity to save fifty percent or more by negotiating.

To get started today, call our toll free 1-877-680-6064 to speak with an associate or fill out the form below and we will contact you within 24 hours.

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